Metro inside baseball: economic incentives process could change

A piece of legislation quietly working its way through the state legislature would shift the way Metro government hands out economic incentive projects to businesses and developers.

For many years, Metro Council members could initiate economic impact plans and propose them to the city’s Industrial Development Board for approval, after which time the entire council would vote on the matter and then the mayor would sign off.

Then in 2008, the IDB found itself wracked in turmoil when its staff lawyer was accused of malfeasance and ineptitude, including initiating board action without actual approval from the board, now chaired by Metro politico and prominent attorney Nick Bailey.

In response to the situation, Mayor Karl Dean’s administration went up to the legislature and helped pass a law that changed the process for approving economic impact plans — the offering of tax breaks for developments.

Now proposed economic incentive plans must be submitted to the mayor before they go to the IDB for approval. While Dean’s office changed the process so it could get a handle on the IDB’s actions, some council members worried that the new setup would politicize a process by making the mayor the gatekeeper for economic incentive programs.

Other Metro observers actually support the current arrangement because they believe it streamlines the process by allowing the mayor to negotiate directly with businesses and developers.

Under the guidance of state Rep. Jim Gotto, who is also an outgoing council member, a new bill would return the process to its original setup. The bill is sponsored in the senate by Sen. Douglas Henry, whose campaign was managed by Bailey.

After rumors that the administration would adamantly oppose the bill, Metro Finance Director Rich Riebeling sent a letter to state Rep. Brenda Gilmore yesterday stating that the administration has no issues with the proposed changes.

Because the IDB has improved its oversight and operations, the “concerns that led the administration to seek the legislative change in 2008 have been addressed,” according to Riebeling’s letter.

The bill will be considered in the House state and local government committee today, where it is expected to advance.